Comments and outlook for 06-20-2011

Update 06-20  02:25 Looks like we got a slight pullback where the 2.8TD cycle should have bottomed.

Update 06-20 12:15 Tested (an broke slightly) the 1278 FIB level on S&P.  Do we now pull back some?

Friday's outlook was pretty much on target - a moderate gain.  Even though the short cycles are up they are having limited success because the longer cycles are down.  This situation continues early this week.

The 22TD, 11.2TD, and 5.6TD cycles are up on Monday.  The 2.8TD cycle is down most of the day and bottoms late day.  So the short cycles are aligned to provide some upside push.  The 20 week (Wall) cycle is down providing some modest downside pressure.  The 1 year cycle is hard down offsetting a lot of the upside from the shorter cycles.

Overall you have a battle between the short cycles pushing up and the longer cycles pushing down.  In my opinion the shorter cycles hold a modest advantage at this time.  So I expect the market will trade in a fairly narrow range and the S&P should end up 4-5 points.  We probably will test the 1278 FIB during the day.

Here is a visual using the SPY:

GL traders.  Do your own analysis.  Don't get greedy - the upside is limited.